When it comes to updating benefit packages every October, "most people run for the hills," said Mark Germain, certified financial planner and founder and CEO of Beacon Wealth Management. "They wait until the last minute and just check off the boxes. And they don't always seek out advice, because they don't understand the options and don't know what questions to ask."
Germain recommends that employees consider these three factors:
- Anticipated expenses. "What will they be spending on in the next 12 months? Medical? Disability? Child care? Education? Legal? The single most important thing is, which options will be the least out of pocket for them in the coming year?"
- 401(k) plan. Check to see if there is an employer match and if regular deposits are set up.
- Long-term care insurance. "Some companies allow employees to buy this within the company plan. They need to understand that buying it now is cheaper than when they retire, and they may be able to convert this policy to a private plan and take it with them when they leave the company."